I find it creepy. It is a good thing I don’t follow New York Times reporters on Twitter or you might find that splashed across a major paper today. These days I feel like I see completely incongruous ads showing on inventory and I know they tracked me there. (I have not read the Times article or any other related articles, for what its worth.)
(This is “LeadBack” or retargeting, as explained on the Ad.com Japan site today. Notice how the cookie looks like a golden coin!)
As the story was told to me, John Ferber was actually the person that invented retargeting. He had a bolt of lightning in his brain one day that made him see how the technology that was being used for analytics and conversion pixels could be applied to deliver ads to people after they had visited a website and he named this “Advertiser LeadBack”. (Advertiser LeadBack is a designated trademark of Advertising.com, a wholly owned subsidiary of AOL) Advertiser LeadBack was a phenomenally successful product. So successful, in fact, that advertisers would ask other companies for “LeadBack”. Ad.com felt like they were the Coca-Cola of the trade, the brand identity of their retargeting solution was so popular and well-known.
One battle we continually fought at Advertising.com was the battle to cut down the number of retargeting campaigns in a buy. (I thought I had posted the white paper I had written on this subject to the blog, but I cannot seem to find it.) Essentially, our thesis was this:
- Advertisers wanted to spend more on retargeting because it performed so well, but they still frequency capped campaigns because everyone agreed that high frequency was not improving performance.
- Ad.com had the biggest network from a reach perspective.
- Most of the other networks were buying the same inventory to get reach, just different frequencies.
- Ipso facto, buying a campaign on another ad network was typically simply increasing the frequency to a user rather than reaching new users.
- Buying retargeting campaigns from other companies was wasteful.
As it turns out, every time we won that battle, I now think there was another effect: We decreased creepiness online.
I find it creepy. No lie, it is totally incongruous to see some of the ads that I see on some of the sites that I see them on. We talked about creepiness all the time at Advertising.com. Ho Shin’s (Ad.com General Counsel) favorite example was “If I visit a Korean site and then visit the Washington Post, we can’t show an ad in Korean. It would freak people out!” While the ads I see are all in english, I get the same effect regularly today.
I attribute four things to the rise in the creepiness factor:
- Small advertisers having access to retargeting technology. At Advertising.com, we had huge minimums: $25/k month. Only the biggest advertisers in the world advertised with us. If you advertised with us, you were spending an absolute bucket of money advertising online. Only a tiny sliver of your budget was being devoted to retargeting. The result was that people did see these ads all over the place and most of them weren’t retargeted. Further, people had become accustomed to the idea that big advertisers ads would appear in random places as part of a network buy. So if you went to a big web site and then saw an ad for that website somewhere, you could write it off to big marketing campaigns. Not too creepy. With the influx of small advertisers, now people see ads all the time that they know had to be targeted to them. These small advertisers are not buying ad space on all these sites! They are only here because I am here. Creepy!
- Customized creatives. It is one thing to see a Best Buy ad. Best Buy is a big brand, they spend a lot on marketing. It is another to see the TV I was just looking at being shown to me again. Creepy.
- The dramatic increase in retargetable inventory. When most people bought most of their retargeting via Advertising.com, while we had huge reach, we actually worked very hard to limit the amount of frequency that we bought. This was because typically we didn’t have that many ads to show any given person. (As I said, we had high minimums which limited the number of advertisers we worked with at any given point in time.) The result is that you would only see a couple of ads. To extend the Best Buy metaphor, you would go to twenty or thirty web sites and you would see a specific ad that had been retargeted to you on one or two. The campaigns were frequency capped and we simply didn’t have that much inventory. A few billion impressions per day. Now, with the advent of exchanges, people can peak at 10 billion plus impressions every day and people are much looser with frequency caps because the ROI continues to be strong. The result is that you might see these retargeted ads on 10 or 15 of these web sites. Even the biggest advertisers probably aren’t buying all the inventory directly! They must be following you.
- My final point is, in some ways, simply an extension of the above: Quality of inventory is declining. I don’t mean quality in an absolute sense, but in that abstract sense that advertisers tend to think of quality: Big Brands. As long tail inventory gets exposed to exchanges, it just feels less like an advertiser bought the space and more like the advertiser bought you. Best Buy inventory appearing in Yahoo! Mail? But of course! Best Buy ads appearing on random blog about punk rock? Bizarre. Creepy.
I recognize there is no going back, but to deny the creepiness is a lie. We always discussed how it would be “best” if people felt like these ads were not following them at all. The point of these ads, from a squishy brand perspective, is that when a consumer sees these ads, they bolster the credibility of the advertiser – “Wow, that web site is big enough to be advertising on some of my favorite sites, I trust that web site more.”
It would be interesting to see someone A/B test some of these hypotheses to determine their impact on the value of retargeting campaigns. Get to work!